AMESBURY – The Amesbury City Council may be gearing up for a financial fight Tuesday as it discusses four collectively bargained contracts that stand to grant pay increases averaging two percent per year to the city’s union workers over the next three years.
The agreements, which were reached with union leaders representing the city’s police, firefighters, DPW workers and administrative workers, will run through June 30, 2015 if approved. In addition to the pay hikes, the agreements also include concessions including the elimination of the longevity bonus for public safety workers, as well as a restructuring of the city’s education incentive, that Mayor Thatcher Kezer argues will save the city money in the long run.
Over the summer, the city’s employees also agreed to significant changes in their health plans that Kezer said will save the city $371,406 this year. The new agreements, taken into conjunction with those health insurance savings, will result in a net savings of $251,006 for Amesbury this year, Kezer said.
Given that fact, Kezer is asking the City Council to appropriate $120,400 to fund the first year of the agreement. The council will discuss it Tuesday at 7 p.m. in City Hall.
“The employees have stepped up and delivered their end of the agreement,” Kezer told the councilors last week. “I now request this additional funding to meet our end of the agreement.”
In a posting on Facebook, District 3 councilor Donna McClure argued that the money needed to fund the agreement should come from within the existing budget, which was approved earlier this year and did not take prospective union pay increases into account, though it did factor in nonunion increases.
“I have suggested that, if it’s such a great contract, take the money from the existing budget,” McClure said. “They should be able to find it.”
Last week, the agreements were brought before the City Council’s Finance Committee, which debated at length over the reliability of the Mayor’s numbers and over the merits of granting union employees pay raises. The Finance Committee consists of all 9 City Council members.
“The struggle always is on this matter whenever there is any pay raise involved, some people want to just focus on that,” Kezer said. “What I expressed strongly to the councilors was with this whole agreement, you have to look at salaries and benefits, the whole package.”
Prior to the meeting, Kezer submitted a memo to the councilors explaining the new contracts and how the deal would result in a net savings for the city. The memo includes three charts, one that details the city’s health insurance savings over the next three years, one that details the yearly costs of each of the four union contracts and one that calculates the city’s net savings using those figures.
According to the memo, Amesbury will save $794,484 in city health insurance over the course of the three-year agreement. The total cost of the four agreements, taking into account both the pay raises and the concessions, will add up to $497,200, meaning the city would save a total $297,284 based on those numbers.
Kezer praised the city employees for taking a big leap of faith by agreeing to the changes in the health care plans before any agreement on the contracts was approved, and added that the savings were only possible because all four unions agreed to the changes.
“By the employees agreeing to the health savings under this process, the city avoided having to go through the process of adopting and following the new municipal health care law, which would have delayed any savings until next year and would have required the city to pay a 25 percent health savings mitigation cost to the city’s employees.”
Kezer estimated that the city’s mitigation cost would have been $92,851 before negotiating any new collectively bargained contracts.